Rupee's Use in International Trade Transactions on the Rise: RBI Data Reveals Growing Trend

Indian Rupee Gains Ground as International Currency

The Reserve Bank of India (RBI) has reported an increase in the use of the Indian Rupee (INR) for import and export invoicing over the years. According to data compiled by the RBI, the INR internationalisation process has been mutually beneficial to all trading partners.

To enhance the role of INR as an international currency, the RBI has undertaken several measures over the past few years. These measures include increasing the usage of INR for both current and select capital account transactions. The RBI's annual report, released on Friday, highlights the benefits of the ascendence of INR as an invoicing and settlement currency.

The RBI report states that the increased use of INR will provide protection against exchange rate risk, reduce the requirement for maintaining costly foreign exchange reserves in convertible currencies, and offer other benefits. The use of the domestic currency also facilitates the development of bilateral exchange rate markets and reduces transaction costs in foreign exchange transactions.

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The RBI has noted a significant increase in INR-based invoicing and settlement since July 2022. During the period August 2022–July 2025, the compound annual growth rate (CAGR) of imports and exports invoiced in INR has been at 20.9 per cent and 12.7 per cent, respectively.

The latest data on trade invoicing and settlement in Indian Rupee (INR) during 2025-26 exhibit a year-on-year growth for export invoicing (6.5 per cent), import invoicing (9.5 per cent), export settlement (2.7 per cent) and import settlement (41.2 per cent), over the corresponding period of the previous year.

In absolute terms, INR invoicing in imports stood at Rs 2.85 lakh crore in 2025-26, up from Rs 2.60 lakh crore in 2024-25 and Rs 1.94 lakh crore in 2023-24. In case of exports, the invoicing stood at Rs 3.27 lakh crore during the last fiscal, up from Rs 3.07 lakh crore in 2024-25 and Rs 2.87 lakh crore in 2023-24.

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The RBI has also noted that the INR internationalisation process has been mutually beneficial to all trading partners, and based on the principles of reciprocity, it has given a fillip to trade invoicing in several other emerging market currencies.

The Indian rupee traded with a depreciating bias during the last fiscal year amidst trade-related uncertainties, geopolitical tensions, and foreign portfolio investment (FPI) outflows in the equity segment.